A Senate committee approved legislation that would shore up the finances of the State Health Plan, despite concerns from independent pharmacists, as well as state employees, retirees and teachers on the plan.
The proposed legislation would cost the state's the general fund roughly $609 million through June 30, 2011, Dan Kane reports.
It increases premiums by 7.8 percent for each of the next two years. The state pays premiums for employees, retirees and teachers, but those members have to pay premiums for their dependents.
The legislation also reduces benefits for plan members by increasing co-payments and deductibles. It ends free eye exams and eliminates a popular plan option that was costing the state more than expected.
Several senators questioned a provision to cut pharmacy costs through a new provider network for drugs used to combat chronic problems such as high cholesterol or diabetes.
More after the jump.
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They said that independent pharmacists are worried that the provision would provide such low reimbursement that they would be driven out of business. Pharmacists currently receive reimbursement that is 15 percent below the average wholesale price.
Jack Walker, the plan's executive administrator, said the independent pharmacists would be free to join the network, but he did not offer to increase reimbursements. He said the pharmacy business has become cut-throat as mom and pop stores are facing pressure from major companies such as Wal-Mart and Kroger that are offering deep discount prices on generics to lure customers.
Roughly 20 state employees attended the meeting. Ardis Watkins, a lobbyist for the State Employees Association of North Carolina, urged lawmakers to ease the burden on state employees. She said North Carolina ranks 40th in health care spending for employees, and 49th in such spending on their dependents.
"We are asking you to not take this out on the members of the State Health Plan," Watkins said.
The committee made no changes to the bill, which now moves to the Senate Appropriations Committee. Senate Majority Leader Tony Rand, who sponsored the legislation, said it has to clear the legislature by this month so that plan changes can take effect by July 1, the start of the fiscal year.
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